VA joins military in fraught multibillion-dollar health IT contract

Acting VA Secretary Robert Wilkie on Thursday signed a $10 billion contract with Cerner for the biggest digital health record transformation in history despite concerns the project could end in a boondoggle for the sprawling bureaucracy that serves 9 million veterans.

Wilkie said in a statement the contract would “modernize the VA's health care IT system and help provide seamless care to veterans as they transition from military service to Veteran status, and when they choose to use community care.”

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Former VA Secretary David Shulkin announced his intention to sign the single-source contract last June after consultation with Jared Kushner, but then revealed in December that he had put it on hold as the implementation of a related Pentagon contract experienced grave difficulties, including critical safety concerns at four Pacific Northwest treatment centers.

Kushner and others argued the best way to assure seamless health care records was for both the VA and DoD to use the same technology. Others pointed out that since the majority of vets leave the military system after retiring, most of the data sharing would take place between the VA and private doctors and hospitals where 70 percent of veterans’ care takes place. Many of the big academic health centers that treat veterans use Cerner’s biggest competitor, Epic.

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Amid pressure from Marvel Chairman Ike Perlmutter and internist Bruce Moskowitz — West Palm Beach friends of President Donald Trump whom he permitted to act as informal advisers —VA officials pored over the contract for several months and even ordered a major report on it by federal contractor MITRE Corp.

“[W]ith a contract of that size, you can understand why former Secretary Shulkin and I took some extra time to do our due diligence and make sure the contract does what the President wanted,” Wilkie said.

Critics say that despite the delay, however, the contract is not written in a way that guarantees success for VA patients, doctors or taxpayers. For example it lacks specific clinical and interoperability requirements. Veterans Health Administration IT specialists fear they may end up with the same problems as military-run hospitals — or worse.

In addition, the loss of some key agency leaders in the past month is expected to complicate the implementation of the contract. Since Trump fired Shulkin in late April, some key senior officials have quit or been fired at the VA, including Chief Information Officer Scott Blackburn, Principal Deputy Secretary for Health Christopher Vojta and Amy Fahrenkopf, an acting deputy secretary for health. The failed nomination of White House doctor Ronny Jackson added to the sense of disarray at the agency.

The VA's acting chief information officer, Camilo Sandoval, was accused of sexual harassment as a Trump campaign official and has no known experience running a large business transformation like the Cerner contract, which is expected to take a decade.

“The VA needs to remember that the probability they’re flushing that ... down the toilet is actually greater than 50 percent,” Roger Baker, who was chief information officer at the VA from 2009 to 2013, told NextGov.

While the military’s existing digital health record system is widely loathed, most VA doctors like their existing system, VistA, although it dates to the late 1970s and varies in quality depending on the region. Also, unlike military clinicians who have to follow orders, the VA is unionized and its doctors can push back if the Cerner deal develops problems.

“You can tell them what you want them to do, but they put patient care far above anything else, and they will tell you where to stick it if they think you’re impacting patient care,” Baker said.

The Veterans Health Administration is the largest integrated health system in the United States, with 1,240 facilities including 170 hospital complexes.